The economic impact of the Premier League Executive summary

The primary role of the This summary report presents the estimated economic contribution of Premier League is to organise the Premier League in the 2013/14 the football competition . Also included are a of other key performance metrics which between the 20 Clubs that have been updated to refect the most make up the league. recent available information. These estimates represent just a part of the In revenue terms, it is now economic impact of the Premier League and its Clubs. There are a range of other the third largest league in industries (e.g., tourism, broadcasting, the world, behind the US gambling etc.) that are directly and indirectly supported by the competition. and Furthermore, the impact of the Premier League and Clubs goes beyond the (). economic impact described. For example, investment in facilities and the community Each Premier League match is watched by programmes supported by the Premier thousands of fans, who travel the country League in schools and deprived areas has to follow their team, and millions more on reached signifcant scale. television. This interest helps to generate a range of revenues; including ticketing, Building on the appeal of the UK’s most merchandise and broadcast. In particular, popular sporting competition, these the sale of broadcast rights has been one programmes are helping to realise a range of the most signifcant revenue streams of health, education and social benefts for the Premier League and Clubs. through increased participation in and development of skills.

The full EY Economic Impact Analysis of the Premier League is available to download at: www.ey.com/PremierLeagueEconomicImpact

In the 2013/14 season alone, the Premier League and its Clubs contributed:

Over £2.4bn 100,000 £3.4bn £722m in taxes to the jobs in the UK Gross Value Added international Exchequer to GDP broadcasting revenue

1 “ The success of the Premier League, which is grounded in the quality of the football competition, has created a ‘cycle of growth’. This should help ensure that the signifcant contribution to the UK economy and society will continue to increase in years ahead.”

Mark Gregory, Chief Economist, EY

“ We help create the conditions for Clubs to succeed. Quality football in full and vibrant delivers results for the whole game and its wider communities.“

Richard Scudamore, Premier League Executive Chairman

Over 95.9% £225m 546,000 544 Premier League in football solidarity young people engaged artifcial grass pitches utilisation payments on community projects built to date in 2014/15

The economic impact of the Premier League 2 The success of the Premier League drives a cycle of growth

The Premier League competition consists of 380 matches played over a nine month season Stadium utilisation and sees each Club play each other home and away. It is run on a commercial basis and generates a range of revenues – including ticketing, merchandising and broadcast revenues 95.9% – that fow to Clubs in the Premier League and beyond. These revenues have enabled Clubs 2013/14 to invest in all aspects of the game – including their squads, stadia and training facilities – which in turn has generated greater interest in the competition from football fans in the UK and overseas. Average attendance The appeal of Premier League football to both domestic and global audiences has helped to increase the inward economic impact of the competition by attracting international 36,691 tourism, broadcasting revenues and foreign investment. Worldwide, the Premier League is 2013/14 available in 185 countries and broadcast to an estimated 730 million homes.

broadcast in The cycle of growth 185 countries Generate increasing demand and interest in 2014/15 Improve and invest in the Premier League stadia, facilities and talent

Televised games reach 730m homes 2014/15

£722m Distribute equitably and use infuence for wider football 2013/14 development and CSR Convert the interest into commercial success and International broadcasting revenue sustainable growth

1732.5 13/14

520.3 02/03 40+ 11 92/93 87/88

Total (millions)

Broadcasting rights value

3 The growth in popularity of English football has been based on the ability of the Premier Broadcasting revenues distributed to League and the Clubs to realise the value of the football competition. Each of the main Premier League Clubs in 2013/14 were revenue streams, including ticket sales, merchandise, sponsorship, advertising and greater than that in the , La additional uses of the stadium, as well as the sale of broadcast rights, gain from a strong Liga and . It is also more equitably league competition that reaches a wide audience. distributed, with the Club fnishing top of the Premier League receiving 1.6 times With the growing popularity of English club football and the emergence of the pay TV that of the Club fnishing bottom. This market, the Premier League is able to achieve broadcast revenues that were signifcantly compares with two times as much in the greater than previous levels. By way of illustration, in 1992/93 (the frst season of the Bundesliga and almost seven times as Premier League) total broadcasting rights sold for over £40 million per year, which much in . compares to the £11 million achieved by the Football League for the 1988/89 season; in 2013/14 total rights were worth over £1.7 billion. 100 Premier League 90 80 70 60 50 40 Top: £93.2m Over the last 20 years, this growth cycle has seen the Bottom: £57.8m 30 Ratio: 1:1.6 Premier League develop football into a that is more 20 10 attractive and accessible to the general public. 0 12345678910 11 12 13 14 15 16 17 18 19 20 In 2014/15 of all the individual people who attended a Premier League match: 30 Bundesliga 25

20

15 Top: £26.5m 10 Bottom: £13.1m Ratio: 1:2 5

0 123456789101112131415161718

100 La Liga were from black, 90 were female asian or minority 80 70 26% 17% Top: £97.1m ethnic groups 60 Bottom: £14.0m 50 Ratio: 1:6.9 40 30 20 10 0 12345678910 11 12 13 14 15 16 17 18 19 20

80 Serie A 70

60 Top: £67.7m 50 Bottom: £12.9m Ratio: 1:5.3 40

were aged of season ticket 30 holders were 40%18-34 12% 20 under-16 10 0 12345678910 11 12 13 14 15 16 17 18 19 20

The economic impact of the Premier League 4 The growth of the Premier League supports investment at all levels

The global demand for the Premier League Stadium utilisation and average attendance across the drives higher broadcasting revenues European ‘big-fve’ leagues The Premier League is the largest of the ‘big fve’ in terms of revenues. Utilisation

In 2013/14, the Premier League Clubs earned £1.7 billion from all broadcasting rights, which is more than the amount 95% 91% 70% 64% 59% received by the next three largest European leagues combined. 45,000

Of particular note is the proportion of the Premier League’s 40,000 broadcasting revenue which is from international providers. 35,000 At around £722 million, the international broadcast revenues

received by the Premier League in 2013/14 were greater e 30,000 than the total (domestic and international) broadcast revenue 25,000 individually generated by , Serie A, the Bundesliga and Attendanc La Liga in that year. 20,000

Of all the major European leagues, the Premier League has the 15,000 most equitable ratio in terms of the amount received by the 10,000 top and bottom revenue earners.

0 1992 2013 1992 2013 1992 2013 1992 2013 1992 2013 Premier Bundesliga Ligue 1 La Liga Serie A League

Attendance at Premier League matches has grown from an average of 21,125 in the 1992/93 season to 36,691 in 2013/14, an increase of 74%.

The stadium utilisation rate in the Premier League increased from 69.6% in the 1992/93 season to 95.9% in 2013/14, which means that games are played in front of capacity or near capacity crowds.

5 With increasing revenue streams, Clubs continue to invest in their facilities Since the beginning of the Premier League, many Clubs have made substantial investments in new stadium facilities. Indeed, of the 20 Clubs that played in the Premier League in the 2013/14 season, all have embarked upon stadium upgrades — including new stands or refurbishments — whilst eight have moved to entirely new facilities. Each of these represents a substantial programme of private-sector capital investment.

Investment in player performance supports the future of the game £390m £32m £42m spent by Arsenal on spent by spent by The Premier League’s Elite Player Performance Plan (EPPP) aims the on the United on their 2nd to develop more and better home grown players, with a £340 St Mary Stadium Tier expansion million commitment over a four year period for youth development across the top four divisions. A requirement of EPPP funding is a commitment by clubs to support all aspects of a player’s development. In order to achieve this, many Premier League Clubs are investing in their Academy facilities. £27m £15m £260m spent by spent by Stoke City on ’s main By way of one example, in 2012/13, Stoke City opened their new City on the Liberty the Brittania Stadium stand redevelopments £7 million Clayton Wood training facility. This investment has Stadium as part of a wider transformed Clayton Wood from ‘four Portakabins and some grass regeneration programme pitches’ into a state-of-the-art facility.

The economic impact of the Premier League 6 The Premier League generates a range of economic benefts for the UK

The game of football is of considerable The growing interest in the Premier League from home and abroad refects continued investment in the Clubs, stadia, players and economic, social and cultural signifcance to across media outlets. This, in turn, generates signifcant economic the UK. During the football season, thousands activity in the UK, supporting jobs across a range of sectors and generating tax receipts to Government. of fans travel the country to follow their team, while millions more watch live games and highlights on television and, increasingly, online.

Output Gross Value Added (GVA) Capturing the Premier League Employment direct, indirect and Clubs Tax receipts induced effects The approach to estimating the economic impact of the Premier Parachute payments League captures not only the Solidarity payments to direct economic impact resulting Football Championship/Football solidarity League from the Premier League and Clubs, but also the additional Non-league support The economic activity that occurs Premier through their supply chains (i.e. the indirect impact) and League Clubs as hubs of communities additional activity that occurs Investing in facilities Communities from employee spending (i.e. the and Sports participation induced impact). good causes and education International development Capturing the induced impact is perhaps of particular importance in estimating the Local and national tourism economic impact of the Premier Wider League Clubs given that a large economic International exports benefts and recognition proportion of Club spending is on Supported industries wages and salaries.

7 The Premier League generates signifcant returns to Government The Premier League and Clubs contributed £2.4 billion to the public fnances in 2013/14 when direct, indirect and induced effects are accounted for.

The Premier League contributed an estimated £88 million in taxation in 2013/14. This included direct contributions for National Insurance and employee PAYE of £5 million and indirect and induced effects totalling £58 million and £25 million respectively.

Meanwhile the Clubs contributed an estimated £2.32 billion in Premier players contributed 2013/14 through business rates (on all facilities and stadia), corporation tax, National Insurance contributions, player and staff £891m PAYE as well as directly attributable VAT. This includes a direct in taxes in 2013/14 contribution of £1.34 billion and £0.63 billion and £0.35 billion of indirect and induced contributions.

Total tax contributions £bn £2.4bn 3.0 annual tax receipts

£390m £2,407m 2.5

£298m £25m 2.0 £475m £941m in employee PAYE 1.5 £276m

£941m 1.0

Tax receipts 0.5 equivalent to 93,000 police constables 0.0 Employee Employee Employer Corporation Business VAT Total Tax PAYE NIC NIC Tax Rates contribution

The tax numbers presented above do not sum to the total provided due to rounding of numbers

The economic impact of the Premier League 8 Employment supported by the Premier League’s activity

The Premier League supports a broad range of employment opportunities across 6,239 people employed by the the economy Premier League and The Premier League and its Clubs supported over 100,000 full its Clubs time equivalent (FTE) jobs in the UK in 2013/14.

The majority of jobs (95,483) are supported by Premier League Clubs across direct (6,140), indirect (60,145) and induced 65,623 (29,198) impacts. The Premier League itself employed only 99 jobs in Premier League people directly in 2013/14, but further supported 5,478 jobs and Premier League through the supply chain (which includes those supported as a Clubs’ supply chains result of parachute payments and solidarity contributions) and 2,294 through induced effects.

These estimates show the signifcance of the Premier League and its Clubs’ supply chains in supporting a large number of jobs. This 103,000 is, in part, because a large part of this supply chain is made up FTE jobs supported in the UK of labour intensive sectors such as those supporting matchday revenues (e.g. hospitality and catering) and retail.

Direct Indirect Induced Total

Total employment 6,239 65,623 31,492 103,354

Premier 6 2 9 League Club 6,140 0,145 9,198 5,483 employment

Premier League employment 99 5,478 2,294 7,871

9 The Premier League as a contributor to national GDP

The Premier League stimulates economic activity across a range of sectors The Premier League and its Clubs together generated over £6.2 billion in economic output that contributed approximately £3.4 billion to national GDP in 2013/14.

A Sport study calculated the total direct GVA of the sports industry to the UK economy, which included all economic activity relating to the consumption or participation of sport, including equipment sales, ticket sales and education, as £20.3 billion. This compares to the estimate of £2.22 billion direct GVA in this report, which suggests that the Premier League and its Clubs are responsible for just over £1 of every £10 of value that is generated through sports in the UK.

The economic impact of the Premier League and its Clubs is signifcant from an international perspective. With total Club revenues of £3.3 billion in the 2013/14 season, the Premier League was the third largest professional in the world by revenue, behind only Major League Baseball (MLB), and the National Football League (NFL).

Total contribution to GDP £bn

3.5 £0.49bn £3.36bn

3.0 £0.62bn

2.5 £2.22bn

2.0

1.5

1.0

0.5

0.0 Direct Indirect Induced Total

The GVA numbers presented above do not sum up to the total provided due to rounding of numbers

The economic impact of the Premier League 10 Solidarity with the wider football world

In addition to the economic impacts set out in the previous section, the Premier The Premier League League makes signifcant contributions to contributed over non-Premier League Clubs right across the football pyramid. £225 As part of its commitment to developing English football outside of the top tier, the Premier League gives a signifcant proportion million of revenue to Football League and non-league clubs. For example, in 2013/14 the Premier League paid over £225m in solidarity in solidarity payments payments, including parachute payments to relegated clubs. in 2013/14

£171.5 million £38.1 million £13.8 million £1.9 million through parachute payments solidarity payments to solidarity payments to to non-league clubs through to clubs that are relegated Championship clubs League 1 and 2 clubs community and solidarity from the Premier League. payments During the 2013/14 season, there were 10 clubs in receipt of parachute payments

11 Supporting communities and good causes drives sporting and non-sporting outcomes

The success of the Premier League provides a platform for it and its Clubs to invest across the footballing pyramid to support local communities, engage young people and partner a range of other good causes in the UK and globally. Investing in facilities 544 artifcial grass pitches built to date 2,755 real grass pitches with proper drainage systems 1,701 grants for stadia improvement at professional and amateur clubs

Community hubs 137,000 young people engaged in the Premier League Kicks programme at 50 Premier League and Football League clubs 76,000 young people engaged in 12 different sports through the Premier League 4Sport programme 18,917 girls participating in the Premier League Girls Football programme at over 450 locations Schools, education and skills 168,000 primary school pupils taking part in the Premier League School Sport programme Partners including Sport England, The FA, The Prince’s Trust, , and local Police forces 26 countries benefting from the Premier Skills programme in partnership with the

In 2014/15: 161 Premier League, Over 546,000 4,158 schools Football League and young people on with Premier League Conference Clubs projects funded directly sport and education supported by the Premier League programmes

The economic impact of the Premier League 12 The Premier League’s success supports a broad range of UK industries

In addition to the industries which are supported through the Premier League and Clubs, their supply chains and employee spending, there are also other parts of the economy which Tourism indirectly beneft from the Premier League’s success. Media The Premier League attracts tourists from across the globe, helps to stimulate demand across the hospitality sector, supports a growing media and high-tech industry, represents a signifcant proportion of gambling revenues and is a key pillar of the UK brand and image abroad. The economic impact therefore goes beyond the impacts estimated in this report.

Premier League Hospitality

Technology and gaming

Gambling

Over 800,000 £285m 8 100m tourists attended a waged on Premier related Twitter accounts copies of EA FIFA Premier League match League matches among the top 100 in games sold in 2014/15 per month the UK

13 Mark Gregory Chief Economist, UK&I

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Direct Tel: + 44 20 7951 5587 Mobile: + 44 7980 589 964 Email: [email protected] David Mullen Assistant Director, Economic Advisory

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The economic impact of the Premier League 14 EY | Assurance | Tax | Transactions | Advisory

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